25 Years Left For The Construction Industry To Become Sustainable

Munraj Sembhi, CEO Reaforma

The construction industry, responsible for 37% of global emissions, is under growing pressure to embrace sustainability. Founders like Munraj Sembhi of Reaforma are leading efforts to decarbonise the sector, but risk aversion and traditional practices slow progress. With governments setting ambitious climate targets and investors prioritising green financing, the industry must adapt. The next 25 years will be crucial in determining whether construction can truly build a more sustainable future.

Munraj Sembhi is on a mission to decarbonise the construction industry with his startup, Reaforma, which is developing sustainable building materials from waste. He is one of many founders working to solve the significant challenges the construction industry faces. Construction is a major source of pollution and is the largest emitter of greenhouse gases, and is estimated to contribute to 37% of all emissions.   

The construction industry is having to adapt to combat sustainability issues, which is often led by policy targets.

Policy Targets

Governments are already on board and have set ambitious targets. The UK government’s legally binding commitment to achieve net-zero emissions by 2050 sets one of the world’s most ambitious climate change goals. This target aims to reduce Scope 1 emissions by 50% by 2032 and 75% by 2037. 

In 2023, WorldBGC and its global network unveiled the "Global Policy Principles for a Sustainable Built Environment". They were structured around seven key focus areas: carbon, resilience, circularity, water, biodiversity, health, and equity & access. They are supported by actionable policy levers, offering clear pathways for implementation through regulation, information, and incentives.

Sustainability Trends in Construction

The trends suggest a promising movement towards the incorporation of ESG principles into construction. A 2024 Report found,

• 70% of construction projects now incorporate sustainability targets.

• 43% of industry professionals report successfully achieving sustainability goals, up from a third in 2022.

• A 13% increase in net-zero projects compared to the previous year’s report.

• 64% of professionals have worked on a net-zero project in the past year, a significant rise from 49% in 2022.

• 16% growth in the number of organisations measuring their carbon footprint, with 70% now tracking emissions.

• 14% rise in firms setting carbon reduction goals, with 76% now doing so, compared to 62% previously.

• 53% of companies have adopted carbon offsetting strategies, up from 38% in 2021.

  
  

NBS’ parent company Byggfakta Group’s head of sustainability Dr Lee Jones said:

Investment Trends In Sustainable Construction

This focus on sustainability is an important trend for investors to understand, as these principles are increasingly becoming an important factor in construction financing. For example, Barclay's Bank originally targeted to facilitate £150bn of social environment and sustainability-linked financing from 2018 to 2025 and have since announced their new target of $1 trillion (£772 million approx) of Sustainable and Transition Financing for 2032. Similarly, Lloyds Banking Group allocated £2.1 billion of new funding in 2022 for sustainability improvements in the social housing sector, and the bank’s Green Building Tool also assessed 240,000 social housing buildings to help house builders continue decarbonising their projects.

The role of policy and financial institutions are necessary stakeholders. 

Notes Dani Hill-Hansen, Architect and Sustainable Design Engineer at EFFEKT Architects.

There is also increased support of small and medium-scale enterprises that are driving sustainable innovation within the construction and housebuilding industry. For instance, Panthera Group, a company developing an environmentally friendly, reusable hoarding system for construction sites, has eliminated the need for single-use plywood. Their EnvironHoard system reduces carbon footprint by 70%, and the company has also planted over 1,000 trees. Panthera Group successfully secured funding from HSBC UK’s Green SME Fund, along with investment advice to scale up its current turnover of £1.4m. Just a year into operations, Panthera is already attracting international interest from countries like Canada, the U.S., Belgium, Ireland, and Germany.

Munraj Sembhi, Reaforma believes that the industry is often misunderstood: 

The Next 25 Years 

Looking ahead, there is growing concern over how sustainability principles will be implemented over the next two decades. Indy Johar of Dark Matter Labs explains,

Sustainable construction is also being driven by the impact of climate change on real estate. In the U.S., around 35.6 million properties, roughly a quarter of all real estate is facing rising insurance premiums and reduced coverage due to increasing climate risks.

Moreover, the world is facing an unprecedented wave of infrastructure growth. From now until 2050, global building stock is expected to grow by 2.6 trillion square feet (241 billion square meters)—the equivalent of adding an entire New York City to the world every month for the next 40 years. This presents enormous potential for building services engineers to define new performance metrics and create new forms of value.

Conclusion

With climate change already impacting real estate and governments enforcing stricter regulations, the construction sector has no choice but to evolve. Sustainability is soon to become a financial and operational necessity. The growing trend of ESG integration, green financing, and policy-driven initiatives signals that momentum is shifting in the right direction. However, as experts like Munraj Sembhi and Indy Johar point out, true transformation will require more than just new technologies; it demands systemic change, collaboration across industries, and a deep rethinking of how we build. The challenge is immense, but so is the opportunity. Not just constructing buildings, but to reshape the entire built environment for a more sustainable future.